Economic Development 2014 Survey Results SURVEY METHODOLOGY The survey was mailed in June 2014 to 5,237 city-type and county governments. A follow-up survey was sent to those who had not responded to the first mailing. An online survey was available as well, with the URL included on the paper survey. The response rate was 23% with 1,201 local governments responding. HR&A Advisors, an industry-leading real estate, economic development, and public policy consulting firm, helped fund the survey.

GENERAL Which of the following statements best describes who has responsibility for economic development in your local government? (Check only one.) (N=1,175)

1. The local government has primary responsibility for economic development. 2. A nonprofit development corporation has primary responsibility for economic development. 3. Other

Number 785

Percent 67%

232

20%

158

13%

1

Which of the following participate in developing your local government's economic development strategies? (Check all applicable.) (N=1,195)

a. b. c. d. e. f. g. h.

Number Percent 1,027 86% i. Public/private partnership 652 55% j. Private business/industry 439 37% k. Private/community economic dev. foundation Federal government 75 6% l. Utility Chamber of Commerce 682 57% m. College/university Economic dev. 482 40% n. Citizen advisory board/commission corporation Regional organizations 457 38% o. Ad hoc citizen group Planning consortia 91 8% p. Non-profit organizations serving the poor City County State government

Number Percent 388 33% 381 32% 114 10% 246 297 311

21% 25% 26%

92 60

8% 5%

ECONOMIC DEVELOPMENT PLANNING Does your community have a written economic development plan? (N=1,027) Written economic development plan

Yes

43% 57%

No

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Indicate which of the following are economic development goals in your community. Indicate the success level in reaching each. If it’s a new priority and too early to tell, just check the last box on the right.

Priority goal?

Goal

a. Jobs b. Tax base c. Quality of life d. Environmental Sustainability e. Social Equity

Success at reaching goal*

Yes (No. reporting)

No (No. reporting)

1,056 1,078 1,002 536 314

Not at all successful

New prioritytoo early to tell

Number reporting

Very successful

Somewhat successful

81 60 99

1,075 1,097 1,035

20% 23% 35%

62% 60% 52%

8% 8% 4%

10% 9% 9%

483 669

690 508

16% 6%

57% 53%

9% 19%

20% 23%

* Note: Some local governments reported success even thought it was not a priority goal.

Please indicate the extent to which the considerations below motivated economic development priorities of your local government.

a. Change in local economy b. Increased competition c. Change in economic development leadership d. Change in political leadership e. Past activities not successful f. Past activities successful/time for new initiatives g. Heard about new development tools h. Growth in aging population i. Income inequality j. Concern about environmental sustainability

No. No Minimal reporting motivation motivation 1,167 5% 14% 1,148 11% 295

Moderate motivation 37% 37%

Significant motivation 45% 23%

1,145 1,143 1,139

28% 25% 26%

27% 31% 34%

25% 28% 28%

21% 17% 13%

1,131 1,129 1,134 1,129

21% 31% 34% 39%

29% 38% 37% 36%

38% 26% 23% 19%

13% 6% 6% 7%

1,139

30%

37%

26%

7%

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BARRIERS TO ECONOMIC DEVELOPMENT

a. Lack of land available (n=1,166) b. Cost of land (n=1,153) c. Lack of buildings (due to space/costs) (n=1,142) d. Inadequate infrastructure (e.g., no fiber optic cable, water, wastewater) (n=1,154) e. Lack of skilled labor (n=1,160) f. High cost of labor (n=1,147) g. Lack of affordable, quality child care (n=1,138) h. Limited number of major employers (n=1,155) i. Lack of capital/funding (n=1,156) j. Taxes (n=1,153) k. Poor public transit (n=1,154)

l. Distance from major 17% 27% 28% 28% markets (n=1,134) m. Lengthy permit process 8% 34% 34% 24% (n=1,141) n. Environmental regulations 8% 26% 38% 28% (n=1,129) o. Poor quality of life (inadequate education, 24% 39% 23% 14% recreation, and arts/cultural) (n=1,131) p. Lack of political support 15% 38% 33% 14% (n=1,128) 18% 575

21% 4%

30% 54% 14%

2%

13% 32% 32% 24% 8%

26% 40% 26%

q. Citizen opposition(n=1,134) r. High cost of housing (n=1,126) s. Declining market due to population loss (n=1,120)

t. Traffic congestion (n=1,127) 12% 52% 26% 10% u. Income Inequality (n=1,122)

Mediu m High

Low

None

Mediu m High

Low

None

Please indicate if your local government faces the following barriers to economic development and their importance. (Check all applicable.)

28% 43% 21% 7% 28% 51% 17% 5% 13% 48% 28% 10% 41% 41% 14%

4%

36% 45% 15% 3% 25% 51% 19% 5% 23% 46% 22%

9%

49% 33% 12%

6%

33% 44% 17%

6%

36% 47% 13% 4%

23% 44% 24% 9%

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ECONOMIC DEVELOPMENT ACTIVITIES Please indicate your level of use of these economic development tools. Not at all Small business a. Revolving loan fund (n=1,174) b. Small business development center (n=1,176) c. Microenterprise program (n=1,160) d. Matching improvement grants (physical upgrades to business properties) (n=1,169) e. Vendor/supplier matching (n=1,162) f. Marketing assistance (n=1,174) g. Management training (n=1,169) h. Executive on loan/mentor (n=1,160) Business retention and expansion i. Surveys of local business (n=1,173) j. Ombudsman program (n=1,167) k. Local business publicity program (community-wide) (n=1,165) l. Replacing imports with locally supplied goods (n=1,164) m. Export development assistance (n=1,159) n. Business clusters/industrial districts (n=1,162) o. Technology Zones (n=1,165) p. Energy Efficiency Programs (n=1,164) q. Business improvement districts (n=1,166) r. Main Street Program (n=1,168) Business Attraction s. Local government representative calls on prospective companies (n=1,175) t. Promotional and advertising activities (e.g., media, direct mail, website) (n=1,176) Community development u. Community development corporation (n=1,164) v. Community development loan fund (n=1,165) w. Environmental sustainability- energy audits/green building incentives (n=1,166) x. Transit to promote commuting (n=1,165) y. High quality physical infrastructure (n=1,166) z. Job training for low skilled workers (n=1,162) aa. Business assistance, loans and grants to support child care (n=1,160)

Low

Medium High

50% 34% 64% 39%

24% 26% 21% 24%

18% 28% 11% 25%

8% 11% 4% 12%

62% 32% 45% 69%

27% 36% 33% 23%

10% 28% 19% 8%

2% 4% 3% 1%

16% 49% 26% 57% 57% 30% 52% 39% 41% 40%

34% 24% 35% 31% 28% 28% 28% 34% 24% 21%

36% 16% 31% 10% 13% 30% 15% 22% 24% 21%

15% 11% 8% 2% 2% 12% 5% 6% 11% 18%

15%

26%

33%

26%

14%

33%

33%

20%

52% 61% 48%

20% 21% 30%

17% 13% 17%

10% 5% 5%

44% 14% 29% 71%

31% 24% 31% 22%

19% 38% 29% 5%

7% 24% 11% 2%

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bb. Affordable workforce housing (n=1,159) cc. Investments in high quality of life (good education, recreation, and arts/culture) (n=1,158) dd. Tourism promotion (n=1,166) ee. Public/private partnerships (n=1,165) ff. Programs to promote age-friendly businesses for seniors (n=1,158)

Not at all 32% 9% 17% 13% 50%

Low

Medium High

36% 19%

25% 38%

7% 35%

23% 26% 36%

31% 36% 11%

29% 25% 3%

How strong is the competition/cooperation for economic development and tax base among local governments in your region? (n=1,174) 1. Competition is strong 59%

2. Competition is weak 19%

3. Cooperation is strong 52%

4. Cooperation is weak 23%

FUNDING ECONOMIC DEVELOPMENT Please indicate which of the following sources of revenue are used to fund your economic development programs. (Check all applicable.) Funding sources for economic development Local revenues/general fund State grants-in-aid Tax increment financing districts Hotel/motel taxes Sales tax Private funding sources Federal grants-in-aid General obligation or Revenue bonds Special assessment districts 0%

20%

40%

60%

80%

100%

Percent reporting (n=1,148)

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BUSINESS INCENTIVES Please indicate any change in the dollar value of the average business incentive package over the last five years? (Circle one number.) (n=1,034) Much larger 7%

About the same 61%

16%

Much smaller 7%

8%

Please indicate the level of use of these business incentives. Use of business incentives Training Support (n=1,121) Employee screening (n=1,113) Relocation assistance (n=1,110) Regulatory flexibility (n=1,116) Utility rate reduction (n=1,119) One-stop permit issuance (n=1,123) Zoning/permit assistance (n=1,127) Grants (n=1,118) Subsidized buildings (n=1,135) Infrastructure improvements (n=1,147) Free land or land write downs (n=1,136) Special assessment districts (n=1,130) Locally designated enterprise zones… Tax increment financing (n=1,142) Tax credits (n=1,138) Tax abatements (n=1,145) 0%

No use Low use Medium use High use

20%

40%

60%

80%

100% 120%

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ACCOUNTABILITY Is the overall budget allocation process linked to economic development priorities specified in the plan? Budget linked to economic development priorities

Yes 36% No 64%

Do you require a performance agreement as a condition for providing business incentives? Performance agreement is required for business incentives

Never 17%

Sometimes 27%

Always 56%

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Do you perform a cost/benefit analysis prior to offering business incentives? Perform cost-benefit analysis prior to offering business incentives

No 27%

Yes 73%

Do you measure the effectiveness of business incentives? Measure the effectiveness of business incentives

No 25%

Yes 75%

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If “yes,” please identify which of the following measures are used. (Check all applicable.)

Measures used for effectiveness of business incentives Amount of jobs created by the new business Increase in the tax base Amount of money invested in construction materials and labor Cost/benefit analysis New dollars invested in land Number of new businesses relocating or expanding in jurisdiction Company revenue/sales 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Percent reporting (n=831)

Does your local government ever require a percentage of new employees to be hired from within the community as a condition for providing business incentives? Requiring percentage of new employees to be hired from within the community

Yes 18%

No 82%

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Does your local government have an agreement in which companies are liable for paying back the value of incentives should they relocate or shut down during the course of the agreement (known as a clawback agreement)? Clawback agreement

No 42% Yes 58%

Do you have a college or junior college in your jurisdiction? College or junior college in jurisdiction

No 37%

Yes 63%

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